More Student Loan Borrowers Are Dropping Out Of College

Students walk near Royce Hall on the campus of UCLA on April 23, 2012 in Los Angeles, California. A growing number of student loan borrowers are dropping out of college: an expensive mistake that reduces their lifetime earnings.

A growing number of student loan borrowers are making an expensive mistake.

The percentage of college student loan borrowers that are dropping out of school is rising at all types of universities, though especially at for-profit colleges, according to the study. Of student loan borrowers at four-year for-profit colleges, 54 percent drop out, in addition to one-third of all student loan borrowers at community colleges and one-fifth of student loan borrowers at both public and private four-year colleges.

Perhaps more alarmingly, the unemployment rate among college dropouts that are 25 and older now is even higher than the unemployment rate among high school graduates that never went to college at all, according to Labor Department data cited by Reuters blogger Felix Salmon.

Only 56 percent of four-year college students finish their degrees within six years, according to a recent Harvard study cited by Reuters. College students are dropping out because of lack of preparation and the high cost of tuition, according to study.